DigitalOcean (NYSE:DOCN) Shares Gap Down – Time to Sell?

Shares of DigitalOcean Holdings, Inc. (NYSE:DOCN) gapped down before the market opened on Thursday. The stock had previously closed at $109.29, but opened at $101.24. DigitalOcean shares last traded at $98.5380, with a volume of 822,525 shares trading hands.

Analyst Ratings Changes

A number of equities analysts recently commented on the stock. Oppenheimer boosted their price objective on shares of DigitalOcean from $190.00 to $220.00 and gave the stock an “outperform” rating in a research note on Wednesday. Stifel Nicolaus upgraded DigitalOcean from a “hold” rating to a “buy” rating and upped their target price for the stock from $135.00 to $160.00 in a report on Tuesday, July 21st. Canaccord Genuity Group reaffirmed a “buy” rating and set a $200.00 target price on shares of DigitalOcean in a research report on Friday, July 10th. Robert W. Baird started coverage on DigitalOcean in a report on Tuesday, July 21st. They issued an “outperform” rating and a $165.00 price target on the stock. Finally, Weiss Ratings lowered DigitalOcean from a “buy (b-)” rating to a “hold (c+)” rating in a research report on Wednesday, September 9th. One analyst has rated the stock with a Strong Buy rating, thirteen have assigned a Buy rating and three have given a Hold rating to the company. According to data from MarketBeat.com, the stock presently has an average rating of “Moderate Buy” and a consensus target price of $154.69.

DigitalOcean Stock Performance

The business’s 50-day moving average price is $125.04 and its 200-day moving average price is $129.78. The company has a current ratio of 1.31, a quick ratio of 1.31 and a debt-to-equity ratio of 1.14. The stock has a market cap of $10.27 billion, a PE ratio of 44.92, a P/E/G ratio of 93.08 and a beta of 1.70.

DigitalOcean (NYSE:DOCN) last posted its quarterly earnings data on Tuesday, August 4th. The company reported $0.45 EPS for the quarter, topping the consensus estimate of $0.26 by $0.19. The firm had revenue of $281.18 million during the quarter, compared to analyst estimates of $279.03 million. DigitalOcean had a net margin of 23.26% and a return on equity of 31.01%. DigitalOcean’s revenue was up 28.6% on a year-over-year basis. During the same quarter in the previous year, the business posted $0.39 EPS. DigitalOcean has set its FY 2026 guidance at 1.350-1.400 EPS and its Q3 2026 guidance at 0.280-0.300 EPS. As a group, equities research analysts expect that DigitalOcean Holdings, Inc. will post 0.64 earnings per share for the current fiscal year.

Insider Transactions at DigitalOcean

In related news, CFO Matt Steinfort sold 10,000 shares of the company’s stock in a transaction dated Thursday, September 3rd. The stock was sold at an average price of $105.73, for a total transaction of $1,057,300.00. Following the transaction, the chief financial officer directly owned 503,692 shares of the company’s stock, valued at $53,255,355.16. This represents a 1.95% decrease in their position. The sale was disclosed in a filing with the SEC, which is available at this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, CAO Cherie Barrett sold 3,985 shares of the company’s stock in a transaction dated Thursday, September 3rd. The shares were sold at an average price of $105.73, for a total value of $421,334.05. Following the transaction, the chief accounting officer directly owned 58,399 shares in the company, valued at $6,174,526.27. This represents a 6.39% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Insiders sold 22,641 shares of company stock valued at $2,589,317 in the last quarter. 0.96% of the stock is currently owned by corporate insiders.

Institutional Investors Weigh In On DigitalOcean

Several institutional investors have recently added to or reduced their stakes in DOCN. Bank of America Corp DE acquired a new position in shares of DigitalOcean during the second quarter valued at about $241,945,000. First Trust Advisors LP raised its position in shares of DigitalOcean by 9.3% in the 1st quarter. First Trust Advisors LP now owns 1,441,151 shares of the company’s stock valued at $123,622,000 after purchasing an additional 122,675 shares during the last quarter. Bank of New York Mellon Corp purchased a new position in shares of DigitalOcean in the 2nd quarter valued at approximately $98,011,000. Principal Financial Group Inc. boosted its stake in DigitalOcean by 155.3% in the 1st quarter. Principal Financial Group Inc. now owns 1,108,420 shares of the company’s stock worth $95,080,000 after purchasing an additional 674,231 shares in the last quarter. Finally, Allspring Global Investments Holdings LLC boosted its stake in DigitalOcean by 81.3% in the 1st quarter. Allspring Global Investments Holdings LLC now owns 683,707 shares of the company’s stock worth $59,947,000 after purchasing an additional 306,529 shares in the last quarter. Institutional investors and hedge funds own 49.77% of the company’s stock.

DigitalOcean Company Profile

DigitalOcean Holdings, Inc (NYSE:DOCN) provides cloud computing services designed primarily for developers, startups, and small and midsize businesses. Its platform offers on-demand infrastructure and software tools intended to simplify the development, deployment, and management of applications.

The company’s services include cloud compute through Droplets, managed Kubernetes, managed databases, object and block storage, networking, and the App Platform for deploying applications. DigitalOcean also provides developer tools, tutorials, support, and other resources intended to help customers build and scale digital products without managing traditional data-center infrastructure.

Founded in 2011 and headquartered in New York City, DigitalOcean serves customers internationally through cloud infrastructure and data-center regions located in North America, Europe, and Asia.